Radio Advertising Costs: A Simple Guide to Ad Spend in 2023
Radio advertising costs average from $200 to $5,000 per week depending on location, ad length, and size of the listening audience. Producing radio commercials costs from $1,000 to $2,500 depending on inclusions like music, voice actors, and editing, but some stations have in-house resources to cut your costs. Learn more about what drives the cost of radio advertising to learn if it’s a good investment for your small business.
How Much a 30-second Radio Ad Costs by Location
As a guidepost for determining how much does a 30-second radio ad cost per location, we used estimates from the experts at Gaebler. Not surprisingly (and similarly to TV advertising costs), the cost to run radio commercials is higher in larger, more competitive markets. In New York, New York, for example, the cost of a 30-second radio ad will be more than $1,400, while in Topeka, Kansas, running the same 30-second radio ad costs as little as $25.
While this sounds like a bargain, keep in mind that in addition to the cost of air time, advertising on the radio also includes ad production costs. Plus, radio advertising costs can increase dramatically depending on how often per week you want your ad to run and on which shows. Running ads in the middle of the night when listenership is low will be less expensive than during popular drive-to-work shows, but will also reach far fewer people.
Traditional Radio Advertising Costs by City
City | Potential Reach | Number of Radio Stations | Radio Ad Cost Estimate (30-second Ad) |
|---|---|---|---|
New York, NY | 7.8 million | 38 | |
San Francisco, CA | 715,000 | 44 | |
Atlanta, GA | 490,000 | 56 | |
Chicago, IL | 2.6 million | 59 | |
Houston, TX | 2.3 million | 62 | |
Orlando, FL | 312,000 | 20 | |
Cleveland, OH | 360,000 | 17 | |
Denver, CO | 699,000 | 31 | |
Raleigh, NC | 472,000 | 29 | |
Las Vegas, NV | 653,000 | 42 | |
Buffalo, NY | 274,000 | 23 | |
Baton Rouge, LA | 217,000 | 31 | |
Topeka, KS | 125,000 | 12 |
(Source: Gaebler)
Traditional radio advertising is mainly local, which can limit your audience. On the other hand, streaming radio advertising offers a national or even worldwide audience segmented on listener interests rather than location. Advertising on internet-streaming radio shows allows you to target a much wider audience, as listeners from anywhere in the world can hear your ad. However, as such, they can also be more expensive.
Streaming Radio Advertising Costs by Outlet
Streaming Service | Potential Reach | Average Radio Ad Cost | Minimum Budget |
|---|---|---|---|
305 million | 15 to 25 cents per ad served | ||
34 million | $23,300 monthly | and minimum $20,000 order | |
(via SXM Media) | 50 million | $6 visual ads $20 video ads and audio ads (cost per thousand impressions, or CPM) | |
150 million | $7.50 per 60-second ad in small cities $450 per 60-second ad in large cities |
Streaming radio advertising rates can fluctuate depending on the time of day as well as the popularity of shows and stations. In other words, you can’t simply divide the total cost by the number of ad spots to determine how much a radio ad campaign costs. It won’t be accurate because some times of the day are much more expensive than others. Holidays and special events can also influence radio ad pricing.
How to Calculate Radio Ad Costs per Spot
The general formula for calculating how much a radio ad will cost is the number of listeners multiplied by the cost to reach 1,000 listeners (CPM). However, as mentioned, the number of people listening to a radio station varies based on time of day, time of year, station, and program popularity. This means that there is no fixed rate for radio advertising costs.
Generally, determining how much a radio ad costs follows a set formula.
What Is ‘Pricing per Spot’ in Radio Advertising?
Some radio stations offer pricing per spot, which allows you to purchase specific spots (or times) at a generally attractive price point. However, pricing per spot is generally used to secure ad placements during the times of the day (or night) when there are fewer listeners. Ads seem cheap, but only because you are reaching a fraction of the listener base of a prime-time audience.
How much do radio ads cost? Generally, you’ll find higher prices for daytime slots.
For example, a spot that airs at 1 a.m. may have fewer than one-tenth of the listeners of a spot that airs at 1 p.m. With pricing per spot, a radio station can make the cost per spot sound very cheap, while you may be paying more per listener than if you paid to advertise during times with higher listenership. To ensure you’re getting full reach and the best bang for your ad budget, ask for the cost per thousand listeners (CPM) of these spots as well.
Factors Affecting Radio Ad Spot Costs
Many factors can affect radio advertising costs, but most relate to listener demographics, competition, and how well an advertiser can work out a reasonable ad cost with a station. Below are the major elements that determine radio ad costs, such as how many people are listening during your time slot, audience demographics, ad demand, and your ability to negotiate pricing.
Here are the significant factors that impact radio advertising costs:
- Clout: Bigger name radio stations and shows will yield higher-priced ad slots—both for traditional and streaming radio.
- Number of listeners: The more people who will likely hear your commercial, the more you can expect to pay.
- Demographics: Some target groups are more popular among advertisers than others. For example, expect to pay more for an audience of adults aged 25 to 54.
- Competition: It’s common to pay more for ads when many different advertisers want to run ads during the same time slots as you. These usually happen, for example, during the holiday season when many retail stores are advertising sales.
- Negotiation: Stations will generate a pricing proposal, but this is not necessarily the final price. You may be able to negotiate the cost of radio ads down from 20% to 40%, depending on your negotiation skills and the terms of your contract.
Keep in mind that not all radio ads are priced the same way. The final cost depends on the station’s policies, listeners, demand (competition) in a specific market, and other variable factors. For example, if there’s a popular event happening in your town, like a highly contested political election, the price for an ad spot will jump.
Radio Commercial Production Costs
When determining your budget for radio ads, you’ll also need to factor in the cost of your ad’s production. This can be very slim if you’re able to produce a commercial in-house. Conversely, it can cost a few hundred or thousand dollars if you need to outsource from experts. If you’re unsure which option to go with, opt for professional services to ensure high-quality ads engineered to produce the results you want.
Unless you have in-house production capabilities, there are two main avenues for producing radio commercials:
- Outsource ad production to a professional agency: This is the more expensive option, and outsourcing to an agency may cost anywhere from $350 to over $3,500. However, it could provide you with a higher-performing and higher-quality advertisement.
- Hire a freelance voice actor or script writer: You can write your own ad script and then hire professional voice talent to record your ad for you. This is a low-cost way of producing a radio ad and involves an investment of as little as $5 through Fiverr. Likewise, if you need help writing a script, experienced Fiverr professionals can help.
Cost of Radio vs Other Types of Ads
Generally, radio ads are in the median in terms of pricing compared to ads from other outlets, such as television or print. Radio is considerably cheaper than TV but still costs more than social media or digital advertising. See how much radio ads cost compared to other channels below:
Radio advertising costs compared to other mediums
Because advertising costs vary drastically per channel, it’s important to plan out your ad campaign’s main objectives first and foremost. For example, is your main priority city-wide brand awareness? If so, TV and radio advertising could be your best choice. However, if you mean to drive purchases, online advertising would likely be more effective.
You’ll also need to evaluate your costs carefully—for a more detailed breakdown of advertising costs for each media channel, check out the resources below:
- Find out everything you need to know about TV advertising costs (plus how to get a commercial on TV).
- Learn how much newspaper ads cost and the factors affecting them.
- Learn how much it costs to advertise on billboards, plus ad tips.
- Google ads remain one of the most cost-effective online advertising channels. Learn how much it costs to advertise on Google in 2023.
- Social media advertising offers countless benefits and takes little effort—find out the main social media costs per platform.
Radio Advertising Cost Proposal Terminology
When it comes time to purchase a radio ad spot, your local radio station (or internet streaming service) will generate a cost proposal, often called a media buying proposal. The proposal will likely include an advertising rate chart showing how much a radio ad costs for each time slot, along with other important metrics you’ll need to consider.
Because there are many terms that are unique to radio advertising, you’ll want to understand them before agreeing to a price. To help, here’s a quick glossary for terms common in media buying proposals:
- Len: Length in seconds, or how long the radio ad is once produced (e.g., 60-second spot, 30-second ad, 15-second commercial, and so on)
- Spots: Number of times the commercial will run
- Rate: Cost per advertising spot
- Cost: Rate times the number of spots
- Average quarterly hour (AQH): The average number of persons listening to a particular station for at least five minutes during a 15-minute period
- Frequency (Freq): The average number of times the same person will hear a commercial
- Net reach: The number of different people reached in a given ad run
Example Radio Station Rate Chart
Sample radio station cost proposal for a 13-week time frame
Quick Stats About Radio Advertising in the US
Despite the prevalence of online advertising, radio advertising remains a popular option in the U.S. thanks to its effectiveness in reaching a highly segmented and geo-targeted audience, among others. For instance, the radio advertising industry raked in $15.8 billion in 2023—over $3 billion more than in 2020. Keep reading for more stats on radio advertising in the U.S.:
- As of June 2023, radio reached 91% of Americans aged 18 and above—more than smartphones or laptops.
- Revenue for local radio advertising reached approximately $10.9 billion in 2021, a $1.3 billion increase from the previous year.
- People spend 58% more time listening to ad-supported radio than ad-supported podcasts.
- 88% of Americans listen to ad-supported radio inside the car, compared to just 66% at home.
- 64% of Americans consider radio trustworthy—8% higher than cable TV and 38% more than social media.
- According to 87% of listeners, radio’s primary advantage over other mediums is its “local” feel.
Pro tip: Learn more about why small businesses promote themselves on the radio, how to measure ad performance, and more in our guide to radio advertising. Then, learn how you can expand your business’ brand presence even further.
Frequently Asked Questions (FAQs)
The cost of a 30-second radio ad varies depending on location, time slot, network popularity, and more. According to our research, the nationwide average is $327. New York City has the highest radio advertising costs at $1,405 for a 30-second ad, while Kansas City is the cheapest at just $25 for the same type of ad.
Generally, it costs between $200 and $5,000 weekly to place an ad on the radio. However, radio has no fixed ad rate, so determining how much it costs to advertise on the radio will vary greatly depending on factors like location (big cities are more expensive than small cities), your ad’s time slot, the radio station’s popularity, and your listener demographics, among others.
Radio ads cost less than television ads because they only require audio (no video), and are therefore easier to produce. The average cost to air a 30-second radio ad is $327, while for television, this costs $105,000. Similarly, outsourcing production of a radio ad starts at $300, while for TV can be upward of $10,000. While radio ads also generally have a smaller audience, this also means they are far more targeted.
Bottom Line
The cost of radio advertising depends on multiple factors, but is generally calculated by the number of listeners multiplied by the station’s price for every 1,000 listeners. However, pricing is usually negotiable to fit your specific budget and needs. Overall, radio advertising offers a good opportunity to grow your brand awareness among a highly targeted audience. Take note of the radio advertising costs above to determine if it’s an effective strategy for your business.
